The use of embryonic stem (ES) cells, with their capacity to differentiate to almost any cell type, holds great promise for advancing research on human diseases, regenerative biology, and the development of more effective treatments. However, currently available methods for directing the differentiation of ES cells to specific cell types and producing sufficient numbers of the desired cells are inefficient, costly, and complex. In addition, the generation of genetically modified animals using ES cells is inefficient, primarily because of the unpredictability of germline transmission, and, where transmission is achieved, the resulting chimeric animals give rise to a mixture of offspring derived paternally from both the host and the introduced ES cells. At the same time, however, it is well established that when mouse embryonic stem (mES) cells are introduced into a mouse morula or blastocyst stage embryo, and then implanted into a pseudopregnant mouse, the introduced ES cells can contribute significantly to all tissues of the embryo proper, including the germline. Additionally, in mice it has been shown that embryos can often developmentally compensate during embryogenesis and survive when populations of cells nonessential to life are blocked or ablated by genetic manipulation. Of relevance here, it has also been shown that the resulting open developmental 'niche'can often be populated by ES cells introduced into the very early mouse embryo, with these cells differentiating to compensate and fill in for the ablated host populations. Hence, the capability to create embryonic niches and to cause their preferential ES-cell colonization represents a unique opportunity to develop tools enabling the efficient development of specific cell types within chimeras, including the germline, from ES cells. We propose to develop and implement a novel approach that will facilitate the directed differentiation of stem cells to specific cell types, and as a demonstration of the approach's utility, significantly improve germline transmission efficiency and the numbers of animals produced. To establish this tool, we will: 1) Develop and implement the efficient colonization of the mouse germline in chimeric animals through the introduction of mES or induced pluripotent stem (iPS) cells into host embryos in which a niche will be opened by selectively ablating host embryo germ cells early in development;2) Apply this preferential chimerism approach to test the germline capability of a genetically diverse, novel set of fifteen mES and iPS cell lines;and 3) Use in vitro fertilization (IVF) to rapidly, specifically, and synchronously expand mES cell-derived germline offspring from the resulting chimeras. Establishment of this method will facilitate the selective colonization of specific tissues within chimeras. This will have far-reaching consequences for the examination of specific gene function within developing cells and tissues and for human regenerative biology. PUBLIC HEALTH RELEVANCE: Stem cells, with their capacity to give rise to almost any cell type, have the potential to significantly advance biomedical research and the development of improved disease treatments including regenerative biology. Mouse models are critically important tools for the study of stem cells, control of their differentiation, and understanding gene function - research that is necessary prior to use of stem cell-based treatments in humans. We propose to develop a novel approach that will enable investigators to 'drive'stem cells to given desired cell types, which will also significantly facilitate the generation of mice for studying specific human diseases.